Dror Ortho-Design, Inc.

Performance Summary

Dror Ortho-Design, Inc. reported a net loss of $2.5 million for the fiscal year ended December 31, 2025, compared to a net loss of $5.8 million in the prior year, representing a 56.9% improvement. The company generated no revenue during either period, consistent with its development-stage status. Total operating expenses were $2.2 million, consisting of $816K in research and development (down 47% from $1.5 million in 2024) and $1.4 million in general and administrative expenses (down 5% from $1.4 million in 2024). Share-based compensation expense decreased significantly to $39K from $2.2 million in the prior year. The company's financial position shows total assets of $259K, total liabilities of $3.1 million, and stockholders' deficiency of $2.9 million as of December 31, 2025.

Revenue Analysis

The company currently generates no revenue from operations. Management states in the filing that 'the Company currently does not generate revenues to fund operations and anticipates that it will continue to incur significant losses as it continues to develop the Platform.' The business model outlined in Item 1 indicates future revenue generation is intended through reselling solutions through a professional dental network, providing ongoing monitoring and treatment plans, and eventually selling directly to consumers in qualified cases with remote dental professional involvement. No segment revenue breakdown is provided as the company is pre-revenue.

Margins & Profitability

With no revenue, gross margin and operating margin calculations are not applicable. The company reported a loss from operations of $2.2 million for FY 2025. Research and development expenses decreased by 47% year-over-year to $816K, primarily due to decreased outsourced consulting activities related to product development due to limited funding. General and administrative expenses decreased by 5% to $1.4 million, primarily due to reduced professional fees offset by increased salary-related expenses. Other expenses net totaled $322K, including financial expense of $41K, change in fair value of derivative of $29K, Registration Rights Agreement expense of $520K, and convertible promissory note discount amortization of $310K.

Cash Flow & Balance Sheet

Net cash used in operating activities was $2.1 million for FY 2025, compared to $2.7 million in the prior year. The company generated $1.8 million in cash from financing activities through proceeds from convertible promissory notes. Cash decreased by $321K during the year to $229K as of December 31, 2025. Total current assets were $239K, including $229K in cash and $10K in receivables and prepaid expenses. Total current liabilities were $3.0 million, including $1.3 million in convertible promissory notes, $722K in derivative liability, $520K in Registration Rights Agreement liability, $293K in accrued expenses, and $114K in accounts payable. The company has a working capital deficit of approximately $2.7 million and an accumulated deficit of $22.1 million.

Outlook

Management acknowledges substantial doubt about the company's ability to continue as a going concern due to recurring losses and insufficient liquidity. The company intends to spend approximately $1 million over the next 12 months on software and hardware development, regulatory approvals, and IP protection. Management states that 'we will need to raise additional capital to fund operating losses and grow our operations' and is evaluating various financing strategies including secured or unsecured debt, convertible debt, and equity offerings. The company received FDA 510(k) clearance for its ZSmile Platform in February 2026 and plans to market in Israel, the European Union, United Kingdom, United States, and Canada subject to regulatory authorization. Key risk factors include the company's development-stage status, lack of operating history, dependence on additional financing, regulatory compliance requirements, and competition from established aligner companies.